Daily U.S. oil production hits 22-year high

U.S. refineries such as Valero's in Three Rivers pushed domestic oil production to 7.5 million barrels a day in July, the highest monthly output in 22 years, and the U.S. Energy Information Administration says production could exceed imports by October.

U.S. oil production reached 7.5 million barrels a day in July, the highest monthly output level since 1991, according to a new government report.

In its Short-Term Energy Outlook, the U.S. Energy Information Administration also said U.S. production could exceed imports by October for the first time since early 1995.

The agency projected that production for the full year will average 7.4 million barrels a day, rising to daily output of 8.2 million barrels in 2014.

The report this week also said that dropping crude oil prices will take retail gasoline prices down 13 cents a gallon in the second half of the year — welcome news to motorists who have seen a run-up at the pump as summer driving peaked.

The Energy Information Administration said regular gasoline averaged $3.59 from January through June and will average $3.46 for the July-December period. The price jumped from $3.50 to $3.68 in the first three weeks of July, the agency said.

The Energy Information Administration said Brent crude, the international benchmark, averaged $108 per barrel during the first half of the year, but will drop to $104 a barrel for the second half.

Meanwhile, the gap between that price and U.S. benchmark West Texas Intermediate has narrowed as improving transportation infrastructure has begun to relieve a glut that had depressed U.S. prices. The boom in shale drilling has increased production — often in new areas not readily accessible to existing pipelines.

The agency predicted that for all of 2013, Brent will average $105.80 and West Texas Intermediate will average $96.96 a barrel.

In trading Thursday, Brent closed at $106.69 and West Texas Intermediate at $103.40.